United Q1 $542M loss

[pilotgolfer]

You really think they'll need to furlough more than 600?

The release only said 600 union represented employees. It didn't specifically say pilots. If you park 30 Guppys, I would say a ballpark of 300 pilots could be gone. Who knows the actually crew ratio per plane for the 737's?

Let the dust settle before you jump to too many conclusions. 600 or 300 is irrelevant to me personally...being at the bottom of the list.

 

[lowecur]

Wow! That didn't take long for some azzwipe to call for the demise of UAL. That's faster than back in 02/03.
What do you think this industry slowdown is going to do to your precious Embraer stock?

Andy, you nincumpoop...go suck on your binky to help with those anxiety attacks.

I bought my stock at $14., and it will take a catastrophic depression to get back there. ERJ is well diversified in the world market, and Brazil is presently a creditor nation that imports no oil (who would have thought) and has just discovered a huge oil deposit offshore.

Neeleman will make another fortune in his new venture, as long as they remove him prior to the airline maturing. Brazil is the place to be in the coming years. They are going from a third world has been, to an economic powerhouse in the next decade.

imp: ​

 

[flygirlqt]

Andy, you nincumpoop...go suck on your binky to help with those anxiety attacks.

I bought my stock at $14., and it will take a catastrophic depression to get back there. ERJ is well diversified in the world market, and Brazil is presently a creditor nation that imports no oil (who would have thought) and has just discovered a huge oil deposit offshore.

Neeleman will make another fortune in his new venture, as long as they remove him prior to the airline maturing. Brazil is the place to be in the coming years. They are going from a third world has been, to an economic powerhouse in the next decade.

imp: ​

UAL just dipped below $14, down 34.77%

 

[Kugelblitz]

Wow! That didn't take long for some azzwipe to call for the demise of UAL. That's faster than back in 02/03.
What do you think this industry slowdown is going to do to your precious Embraer stock?

Friend, as an ex-TWA pilot who has gone through this, I wouldn't be so quick to get angry at someone pointing out an outcome that is quite possible. I can't imagine any combination of mergers that would resolve this intractable financial situation evolving at United. I doubt CAL is going to be quick to wed a company

If you are a UAL pilot at this time, you had better be thinking about 'the day after' and make contingency plans. With fuel prices the way they are and what is an apparent drop in air travel demand, things are just starting to get ugly.

Very best of luck to all of you, and I sincerely mean that. But don't live in denial about the possibility of job loss, you are only hurting yourself.

 

[contrail67]

The release only said 600 union represented employees. It didn't specifically say pilots. If you park 30 Guppys, I would say a ballpark of 300 pilots could be gone. Who knows the actually crew ratio per plane for the 737's?

Let the dust settle before you jump to too many conclusions. 600 or 300 is irrelevant to me personally...being at the bottom of the list.

And the schedules are already at 90+ hours per month...if that number is decreased it could reduce any furloughs if any are to happen. Remember the statement said they "expect" to furlough by the end of the year.

 

[ualdriver]

End of Q4 cash/equivalents was $3.55B; end of Q1 cash/equivalenets is $2.9B. I didn't pull any numbers apart, so that was first WAG back of envelope.

When we went into BK the last time, $2B was the critical number. Less than that, we couldn't come out the other side.
I know Q1's a weak quarter, but how much has the price of oil risen this quarter?
The unencumbered assets help.
The lack of deliveries help.
The aircraft coming off of lease help. (We could park more than 30 if things get worse).

I backed out the special dividend to come up with $300M. I seriously doubt that there will be a second special dividend. However, I've been wrong in the past and will be wrong in the future.

Those numbers were truly ugly. I don't see posturing for contract negotiations (way too early); every other airline's reporting bad numbers. I don't even think that these were kitchen sink numbers; I think that they were pretty straight up bad.
I'm only ~600 from the bottom so I figure that I'll be gone right after Christmas. I expect the first round of furloughs to occur this fall. Good luck to you and everyone left standing; I hope that they can avoid BK this time around.

I think we're a long ways from entering bankruptcy again and I'm not just saying that because I'm a UA employee and I'm fearing for my job or something ridiculous like that.

We didn't even go into bankruptcy the first time until we were down to 1B in cash. We now have 2.9B and 3B in unleveraged assets. Over the last 12 months, we've burned through 573M, 250M of which was a dividend AND there was some debt repayment in that number. I can't imagine they're going to do that again!

And we're not laying off 600 pilots- or I should say that they didn't say we were laying off 600 pilots. They just mentioned a number of "represented" employees that are going to be let go. Could be pilots, mechanics, CSR's, F/A's, whoever.

I think the UA employees reading all of this bad news need to take a breather (not you Andy but the lurkers who never post at all). Take the gloom and doomers who normally post here with a grain of salt. Most of them haven't a clue as to what the actual financial situation of any airline is other than what they on this forum, and unfortunately that's not saying much.

Yes, the numbers are probably the worst in the industry for 1Q '08. We're sitting on cash, we're sitting on hard assets that can be borrowed against (if it even comes to that), and there are no covenants (bank, credit card) that we're even coming close to violating.

The bottom line is that the entire industry needs to charge fares to cover its costs, and they're not doing that right now. When if/they do, I suspect our losses won't be as bad or, perish the thought, we might actually make some money.

 

[Poahi]

Andy,

What would be the effect of the Federal Government removing the tax on jet fuel? Would that make enough of a difference?

 

[scarlet]

yeah 2.9 billion and losing 500million every 3 months??

2.9 will not last long?

 

[Andy]

And we're not laying off 600 pilots- or I should say that they didn't say we were laying off 600 pilots. They just mentioned a number of "represented" employees that are going to be let go. Could be pilots, mechanics, CSR's, F/A's, whoever.

I think the UA employees reading all of this bad news need to take a breather (not you Andy but the lurkers who never post at all). Take the gloom and doomers who normally post here with a grain of salt. Most of them haven't a clue as to what the actual financial situation of any airline is other than what they on this forum, and unfortunately that's not saying much.

I agree that it doesn't say 600 pilots, nor is it specific. I'm making my plans based on being furloughed after Christmas - I think that'd be about the earliest I'd get hit.

And yes, I do tend to post the 'worst case' scenario on this.

 

[Andy]

Andy,

What would be the effect of the Federal Government removing the tax on jet fuel? Would that make enough of a difference?

Honestly, I have no idea. It might make the downturn a little less deep, but high fuel costs are occurring at the same time as demand is softening. It's going to be a tough go for all airlines, not just United.

 

[Andy]

yeah 2.9 billion and losing 500million every 3 months??

2.9 will not last long?

Pull out the special dividend and profit sharing, both of which are likely nonrecurring, and you're just a hair under $300M per quarter.
They paid down a lot of debt last year so that there's several billion of unencumbered assets available to get loans on.

 

[ualdriver]

yeah 2.9 billion and losing 500million every 3 months??

2.9 will not last long?

1) We're not losing 500M every 3 months, unless you're assuming that our normally strong quarters (2nd&3rd) are going to be as weak as our first quarter.
2) We had a NET loss of 500M for this quarter, which is usually a weak quarter.
3) A NET loss of 500M does not mean a company has burned through 500M in cash. Their are no cash items (like depreciation) that the 500M includes that is not immediate cash out of pocket.
4) I doubt we could burn through all that 2.9B before we'd get into trouble. It would probably happen (estimate) 1B sooner than that.

 

[Soulfly]

.....

 

[Soulfly]

With Oil at $120 a barrel and climbing with no end in sight, it doesn't really matter........

Mergers don't change the price of oil.

Airlines will park airplanes and raise fares. It is the only option.

All of us are screwed........Period.

 

[spitfire1500]

With Oil at $120 a barrel and climbing with no end in sight, it doesn't really matter........

All of us are screwed........Period.

Thats right I have so many people telliing me oh don't worry we have 30 years of oil that has been found in the Dakota's, Brazil found a bunch of it......etc. Get your heads out of the sand.....that oil does no good in the ground this is an acute problem in the big picture but will be terminal for many airlines that won't make it through by the time they start recovering any of this oil. Other countries have growing economies that are increasing demand for energy while ours is shrinking right now. We barely manufacture anything here anymore and it's catching up.

 

[Soulfly]

Should have gone to law school. Damnit!

 

[Skank]

Andy, you nincumpoop...go suck on your binky to help with those anxiety attacks.

I bought my stock at $14., and it will take a catastrophic depression to get back there. ERJ is well diversified in the world market, and Brazil is presently a creditor nation that imports no oil (who would have thought) and has just discovered a huge oil deposit offshore.

Neeleman will make another fortune in his new venture, as long as they remove him prior to the airline maturing. Brazil is the place to be in the coming years. They are going from a third world has been, to an economic powerhouse in the next decade.

imp: ​

Brazil, like many of its neighbors has been on the brink of becomming a super power for decades. Military Coups, a completely lopsided distribution of wealth, and political ineptitute have killed every opportunity thus far. I guess we'll have to wait and see if it all comes together this time.

 

[MountainFreak]

Brazil is the place to be in the coming years. They are going from a third world has been, to an economic powerhouse in the next decade.

imp: ​

You may be right, but don't bet your farm on it. I have very clear memories of elementary school civics around 1974, and the textbook had a whole section about how Brazil was the next superpower. They were very sure of it, and it was just about to happen. They even talked about Brazil and ethanol.
Of course, the same text had black-and-white pictures from China which showed crowds of people on bicycles, wearing pajamas and silly caps, and implied they were a has-been backwater...

Don't know why I remember that little bit of trivia from my youth, but it's true!

 

[lowecur]

Brazil, like many of its neighbors has been on the brink of becomming a super power for decades. Military Coups, a completely lopsided distribution of wealth, and political ineptitute have killed every opportunity thus far. I guess we'll have to wait and see if it all comes together this time.

I would hardly concur that anyone in South America has been on the cusp of economic superpower. Argentina and Brazil are the only two nations that have demonstrated any promise, but neither ever had the combination of gov't structure and natural resource wealth to achieve any long lasting prosperity. Brazil still has much poverty but they will have the job growth in the next decade to put the millions of indigenous people to work. Social programs to educate and train these people will be the foundation of their success. Will it be perfect?....never is.....but they will be a nation to respect in the 21st century. They have lots of upside, where on the other hand, the US has much work to do to take back the gov't from big business. The fathers of the Constitution would be ashamed.

imp: ​

 

[lowecur]

You may be right, but don't bet your farm on it. I have very clear memories of elementary school civics around 1974, and the textbook had a whole section about how Brazil was the next superpower. They were very sure of it, and it was just about to happen. They even talked about Brazil and ethanol.
Of course, the same text had black-and-white pictures from China which showed crowds of people on bicycles, wearing pajamas and silly caps, and implied they were a has-been backwater...

Don't know why I remember that little bit of trivia from my youth, but it's true!

Yeah, the days of the oil embargo and Brasilia were a shooting star. Could have worked, if OPEC had stuck together and kept the price of oil high.

Could have another monkey wrench thrown at oil if the world slips into a depression. $50-150 bbl for oil will keep Brazil's economy flush with money, but if it slips below $50 they are in trouble or above $150...the world is in trouble.

imp:​

 

[contrail67]

I think we're a long ways from entering bankruptcy again and I'm not just saying that because I'm a UA employee and I'm fearing for my job or something ridiculous like that.

We didn't even go into bankruptcy the first time until we were down to 1B in cash. We now have 2.9B and 3B in unleveraged assets. Over the last 12 months, we've burned through 573M, 250M of which was a dividend AND there was some debt repayment in that number. I can't imagine they're going to do that again!

And we're not laying off 600 pilots- or I should say that they didn't say we were laying off 600 pilots. They just mentioned a number of "represented" employees that are going to be let go. Could be pilots, mechanics, CSR's, F/A's, whoever.

I think the UA employees reading all of this bad news need to take a breather (not you Andy but the lurkers who never post at all). Take the gloom and doomers who normally post here with a grain of salt. Most of them haven't a clue as to what the actual financial situation of any airline is other than what they on this forum, and unfortunately that's not saying much.

Yes, the numbers are probably the worst in the industry for 1Q '08. We're sitting on cash, we're sitting on hard assets that can be borrowed against (if it even comes to that), and there are no covenants (bank, credit card) that we're even coming close to violating.

The bottom line is that the entire industry needs to charge fares to cover its costs, and they're not doing that right now. When if/they do, I suspect our losses won't be as bad or, perish the thought, we might actually make some money.

Like I posted on another thread...a flight ops manager called me today and said there were not plans right now to furlough pilots and to expect a full summer schedule...he was very encouraging.

Most of the doom and gloomers are the ones that either did not get a interview or got turned down.

 

[Cardinal]

I think we're a long ways from entering bankruptcy again and I'm not just saying that because I'm a UA employee and I'm fearing for my job or something ridiculous like that.
...............
We're sitting on cash, we're sitting on hard assets that can be borrowed against (if it even comes to that), and there are no covenants (bank, credit card) that we're even coming close to violating.

Ya know what's funny? After dilligently looking at the financials, I was on these boards valiantly defending my carrier's honor. Two weeks ago I posted almost your exact words, but said it about F9. As I was typing there was a letter on our CEOs desk informing him of the new, higher, holdback. Three days later F9 was in court.

I'm not saying that's what will happen to UA, far from it. But events have a way of coming out of left field and defying conventional wisdom. Wish you guys all the best, got a friend who's a newhire with a capital "N."

 

[JoeMerchant]

Like I posted on another thread...a flight ops manager called me today and said there were not plans right now to furlough pilots and to expect a full summer schedule...he was very encouraging.

Most of the doom and gloomers are the ones that either did not get a interview or got turned down.

....or are just realists...

 

[Skippy]

im on careerbuilder right now

 

[Andy]

We didn't even go into bankruptcy the first time until we were down to 1B in cash.

You're correct; my bad on that one. How much did UAL get in DIP financing - do you remember?

 

[jtm2222]

Goodbye United

 

[ualdriver]

You're correct; my bad on that one. How much did UAL get in DIP financing - do you remember?

No, I don't. All I remember was that we were dangerously close to violating the DIP covenants a couple of times

 

[Andy]

Ya know what's funny? After dilligently looking at the financials, I was on these boards valiantly defending my carrier's honor. Two weeks ago I posted almost your exact words, but said it about F9. As I was typing there was a letter on our CEOs desk informing him of the new, higher, holdback. Three days later F9 was in court.

I'm not saying that's what will happen to UA, far from it. But events have a way of coming out of left field and defying conventional wisdom. Wish you guys all the best, got a friend who's a newhire with a capital "N."

Cardinal, good luck to ya and everyone over at F9; I'm rooting for you guys to pull through relatively unscathed.

While I don't see the possibility of furloughs at UAL until after the summer, I'm planning for what I think is the 'worst case' scenario. For me, based on my seniority, is a furlough in early 2009. After being furloughed in 2002, I'd rather overplan than underplan.
PCL128 or Lear70 likes to call me an alarmist; that my concern is unwarranted. But I collected more than a couple unemployment checks on my last furlough; I'd prefer to NOT do that again.

 

[grog_sit_reserv]

Hey Lowcur, why the blue writing? Can't you conform? Sheesh.

Oh, by the by, merger on Friday for UAL. They needed to drive the stock down to match LCC to make a cost neutral beginning to it.

Peace out my brudders.

 

[Green]

Hey Lowcur, why the blue writing? Can't you conform? Sheesh.

Oh, by the by, merger on Friday for UAL. They needed to drive the stock down to match LCC to make a cost neutral beginning to it.

Peace out my brudders.

Grog

you seem pretty darn confident there? You're going all in with your credibility. Are you privy to some top secret stuff? Which way will the stock go on monday???????